Dec

31

What does it mean when the FED slashes the interest rate?

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crondawg asked:


i know it impacts how much consumers pay on credit card debt, home equity lines of credit and car loans but what else. Thanks

COURTNEY

Comments

2 Responses to “What does it mean when the FED slashes the interest rate?”

  1. ericsanmiguel on January 1st, 2010 2:45 am

    GORDON

    When Feds cut interest rates it normally means that the hybrid car that you have been wanting would be more expensive as manufaturing rates increase proportionally as the coffee making process for Starbucks. Momentarily and sometime permanent are some structure rebuildings in Iraq as well as Afghanistan. The Middle East economy is struggling and no Fed can cut those rates.

  2. WZL on January 3rd, 2010 5:15 am

    REED

    Basically, the Fed lowers the target interest rate that banks borrow money from each other.

    Once the effective rate has been lowered, a domino effect occurs that eventually leads to lower interest rates within the general economy.

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